Amdocs Limited

Thank you for standing by. Welcome to the Amdocs first quarter 2026 earnings conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star 1-1 on your telephone. If your question has been answered and you'd like to remove yourself from the queue, simply press star 1-1 again. As a reminder, today's program is being recorded. And now I'd like to introduce your host for today's program, Matt Smith, Head of Investor Relations. Please go ahead, sir.

Thank you, operator. Before we begin, I need to call your attention to our disclaimer statement on slide two of the presentation. It notes that some of our comments today may be forward-looking statements and are subject to risks and uncertainties, including as described in Amdoxy's FTC filings and that we will discuss certain financial information that is not prepared in accordance with GAAP. For more information regarding our use of non-GAAP financial measures, including reconciliations of these measures, we refer you to today's earnings release, which will also be furnished with the SEC on form 6K. Participating on the call with me today are Shuki Sheppard, President and Chief Executive Officer of Vandox Management Limited, and Tamar Rappaport-Dugin, Chief Financial and Operating Officer. To support today's earnings call, we are providing a presentation which can be found on the investor relations section of our website. And as always, a copy of today's prepared remarks will also be posted immediately following the conclusion of this call. On today's agenda, Shuki will recap our business and financial achievements for the first fiscal quarter 2026, including our strategic progress in generative AI and data services. Shuki will finish by addressing our financial and business outlook, after which tomorrow We'll provide additional details on our first quarter financial performance and guidance for the fall fiscal year 26. And with that, I'll turn it over to Shuki.

Thank you, Matt, and everyone joining us on the call today. Beginning on slide six, I am pleased to report a solid start to fiscal 2026 as we continue to focus on our primary goal of accelerating Amdoc's long-term growth and position of ourselves as a market leader for the Gen AI era. First quarter financial results were consistent with our expectation. Revenue of 1.16 billion was slightly above the midpoint of guidance, rising 4.1% from a year ago and 3.5% in constant currency. Profitability improved by 40 basis points from a year ago and was unchanged on sequential basis, reflecting our commitment to balance internal efficiency gains with accelerated investments to support long-term growth. Non-GAAP diluted earning per share was $1.81 above the guidance range, primarily due to a lower than expected tax rate for the quarter. And we finished Q1 with a backlog of $4.25 billion, up $60 million sequentially, and 2.7% from a year ago. Tuning to slide seven. I'd like to thank our people around the world for their part in delivering best-in-class mission-critical operations support over the holiday period and for achieving a high number of milestone deliveries under the many outcome-based projects and managed service engagements we are supporting for our customers. Q1 includes several important developments which fraction our underlying basis business, accelerate our global growth potential, and advance our generative AI strategy. First, I am proud to announce that we signed a new multi-year agreement with T-Mobile that includes managed services, software development, and AI innovation. Under the new agreement, T-Mobile and Amdocs will collaborate to support T-Mobile growth strategy and business objectives. Amdocs will continue to support T-Mobile's consumer and business domain, including implementation of Gen-AI technology where applicable. As part of this agreement, Amdocs will also support integration activities related to common systems. Additionally, we are supporting T-Mobile in the integration of U.S. Cellular. As a reminder, integration activities by nature are non-recurring and are ramping down by design once the integration is completed. Overall, this important agreement extends our long-standing strategic collaboration with T-Mobile. Having said that, as mentioned last quarter, we expect a revenue decline with this customer in fiscal 2026 due to a lower level of spending. We expanded Amdoc's global customer footprint and progressed our international diversification strategy this quarter through a combination of organic and inorganic moves. We signed an expanded multi-year engagement at Vodafone Germany, the largest of Vodafone operating companies, and won significant transformation awards with two new logos in Western Europe. Additionally, I am excited to report that we closed the acquisition of Matrix software for $197 billion cash at the end of Q1. Based in California, Matrix is a strategic consolidation move which complements and extends our leading market position around the controlling heel of billing, monetization, and charging solutions. As such, we believe there is an amazing potential to bring our full suite of product and managed services in support of Matrix's impressive customer base. These customers include major tier-one service providers such as Verizon, Telus, Telefonica, Swisscom, Three, Virgin Media O2, and Telstra, as well as a growing list of many smaller tiers operators and MVNOs. Third, I'm encouraged by the highly positive recognition Amdocs is receiving as a market leader in data and generative AI from customer and industry analysts like Gardner. In my opinion, such recognition directly reflects Amdorf's very deep domain expertise, which is unmatched in the telco vertical. During Q1, our commercial momentum continued with additional GenAI-related wins at Telus and other customers. Our next-generation AI platform development is also progressing to plan, with today's announcement of AOS, an agenting operation system. Purpose-based for telecommunication, which we plan to showcase at Mobile World Congress in early March. Now turning to slide eight. I'd like to provide some additional color with respect to our growth strategy, which is designed to deliver the tech-led product and services our customer needs to maximize the value of generative AI data across our customer footprint, accelerate the journey to the cloud, digitalize customer experience in consumer and B2B, monetize next-generation network investments, and streamline and automate complex network ecosystems. Starting with data and generative AI on slide 9, we are busy executing the recent GenAI-related commercial awards as we won with Optimum, Consumer Cellular, EM, Telefonica Germany, and other first mover adopters of Amdocs and Maze are generative AI platform that leverage NVIDIA's AI capabilities. These early awards provide proof points as to the important role of generative AI in telecom industry transformation, as witnessed by the consistent pipeline expansion and growing commercial progress we are seeing. As an example, Telus, Amdocs, and NVIDIA recently teamed up to deliver advanced AI powered quality engineering solution on the Telus sovereign AI factory. Specifically designed to meet Canadian data residency and compliance mandates. This strategic integration will enable secure autonomous testing, automation, and validation for Canadian enterprises and government agencies. helping them to adopt generative AI securely and to roll out digital services faster. As to our long-term generative AI strategy, last quarter we shared that we are accelerating our investment to fast-track development of Cognitive Core, a next-generation AI platform built on the foundation of Amdocs Amaze, which integrates spread-built telco-specific agent libraries and actionable insights. I'm pleased to say that our development roadmap is progressing as planned, with today's exciting announcement of AOS, the world's first agentic operating system purpose-built for telemarketing, which we plan to showcase at Mobile World Congress in Barcelona a few weeks from now. Designed to help service providers accelerate the generative AI, strategize and innovate at scale, AOS operates on top of any BSS or SS stack, embedded currently core and intended directly to telecom operation to elevate customer and employee experiences, unlock new growth opportunities, and drive measurable operational efficiency by executing complex end-to-end workflows across BSS or SS environments. Overall, we are excited by the announcement of AOS. which we believe can emerge as a long-term growth engine for Amdocs, as Telco realizes the potential to simplify and accelerate their AI transformation journey. Switching to cloud in slide 11, Amdocs remains uniquely positioned as the preferred partner to lead the Telco industry's journey to the cloud, reflecting our proven ability to accelerate public, private, and hybrid cloud migrations. We are continuing to grow our cloud migration collaboration with AT&T, supporting them as they move another key infrastructure stack to the cloud. This represents an important next phase in AT&T's cloud modernization journey. By applying MDoc's AI-driven migration capabilities and deep telecom domain expertise, we are helping AT&T modernize core infrastructure faster, reduce transformation risk, and improve operational efficiency while creating the foundation for future innovation. As discussed last quarter, our SaaS-based platform, including Amdocs ConnectX, Amdocs MarketOne, and Amdocs eSIM are also contributing to growth with rising customer adoption. This quarter, Androx Marker One was selected by V, formerly Vida, a leading smart TV platform powering over 50 million connected TVs globally. Marker One will drive V's global OTT subscription and streaming bundles on home AS-equipped smart TVs, streamlining OTT partner onboarding, enabling innovation subscription bundling, and digital services expansion across the international footprint. Looking forward, Cloud will remain primarily focused for Amdocs as we continue to support our global telco customer base, many of which are just getting started on their multi-year cloud journeys. Turning to slide 12, I'd like to spotlight some additional deals we need across Amdocs' other strategic domains this quarter. First, I'm delighted to announce that Vodafone Germany has extended its multi-year digital transformation engagement with Amdocs. As part of which, it will decommission multiple legacy technology stacks to simplify its IT infrastructure across its fragmented cable portfolio. The program will complete with a gradual migration, following proven agile delivery, running fully in public cloud, and utilizing GenAI tools to increase delivery efficiency. In Western Europe, we want significant digital transformation and work with two new logos, that further expand our strategic relationship with the large global telco service providers. In Italy, Swisscom's suspender in FastWeb will broaden its use of the OMS Amdocs platform as the unified orchestration layer to manage end-to-end order management across both wireline and wireless consumer domain in the new core, resulting for the post-measure integration with Vodafone Italy. Within the BSS and OSS sphere, Swiss service provider Sunrise has extended their collaboration with Amdoc to support AI evolution in CRM, setting the foundation for further increase its net promoter score and to offer customers the best service at any time. We also signed a new four-year agreement with Telefonica Germany to renew our Actix mobile network platform. Actix plays an important role in optimizing Renewal Network performance. helping Telefonica Germany enhance coverage and network quality at scale. This also reflects the ongoing value we deliver in mission-critical network operation, and federal students are long-term standing in collaboration with the customer. Finally, we recently signed a proof of contract with a leading operator in Japan, deploying Amdocs Revenue 1 with billing capabilities to run real operation scenarios. This engagement reinforced the skills of our revenue management portfolio in supporting complex, strategic customer environments and creates a path for potential expansion. Now, to the current operating environment. We believe many growth opportunities exist across our several addressable markets of roughly $60 billion by tapping new domains as our largest long-standing customers, capturing additional wallet share at existing customer and new logos, diversifying in new geographies such as Japan, Africa, and Middle East, and bringing innovation in emerging strategic domain such as generative AI, fiber rollout, cloud migration, and the rapidly evolving MNO segment. With our deep telco domain expertise and unique tech-led customer-based business model, we are well positioned in the market and laser-focused to monetize the rich deal pipeline we see in front of us. That said, we are, of course, closely monitoring our customer demand and spending behavior within the prevailing global macroeconomic environment. Bringing everything together on slide 14, With our solid first quarter performance and our visibility for the remainder of the year, we are reiterating our guidance for revenue growth of between 1% and 5% in constant currency for fiscal 2026. Similarly, we are on track for non-GAAP diluted earnings per share growth of between 4% to 8% in fiscal 2026. the midpoint of which equates to an expected total share of return in the high single digits, including our dividend yield. On a personal note, after many years serving Amdocs in a range of leadership roles, including more than seven years as President and Chief Executive Officer, I've decided to retire from my role as President and Chief Executive Officer. It has been the greatest privilege of my professional life to lead this incredible organization and instead of the people for the past seven years. I'm immensely proud of what we've accomplished together. We didn't just navigate and shift the cloud and the rise to Gen AI, we transform Amdocs into a truly catalyst for the digital age. I am pleased to announce that Jimmy Horvick, A long-time colleague and trusted partner who is here with me today will succeed me as the President's Chief Executive Officer effective March 31, 2026, following a planned transition period. I take this step with a deep confidence in Amdoc's position, long-term strategy, and leadership team. Having worked closely with Shimi over many years, I have seen his ability to lead the company through periods of significant industry and technological change while maintaining a strong focus on customer and execution. This planned succession reflects the depths of the strength of Amdoc's management team and ensures continuity in our strategic direction. I am confident that Shimi, supported by an experienced and highly capable executive team, will build on Amdoc's strong foundation and lead the company to new highs. I'm delighted to say that Shimi is here with me in the room today. So let me hand things over to him to say a few words before moving to Tamar.